“We don’t have any of the early signs of recession. Yet, we have a market where despite 20 percent earnings growth, the P/Es [price-earnings ratios] have fallen 20 percent,” the fund manager said on CNBC’s “Trading Nation” on Friday. “What that tells us is the market is pricing in recession in 2019. We just don’t think that is going to happen.”

Yet, it appears the Street isn’t convinced.

The major indexes ended the week deep in the red, with the Dow plummeting almost 500 points on Friday mainly due to global growth jitters. It’s now off 2.5 percent so far this year.

The S&P 500, which closed at its lowest level since April, is off more than 12 percent from its all-time high of 2940 hit on September 21 and 2.75 percent for 2018.

However, relief may be in sight. Chiavarone suggested next week’s Federal Reserve’s policy meeting could help calm the Street and act as a catalyst for a year-end rally — particularly if Chairman Jerome Powell confirms he’s moderating his stance on tightening interest rates.

“We need to get a little bit of clarity on that. If it turns out that it’s just the December hike, and then we’re in pause… I think that’ll provide some comfort to the market,” said Chiavarone.

Plus, he said any solid news on resolving the U.S.-China trade war could also help propel stocks higher. “You’re going to have volatility in the market until we have more clarity on trade,” he added.

Chiavarone’s firm has a 2019 S&P 500 year-end price target of 3100, a number that was originally expected this year. Federated downgraded this year’s target to 2800, following the deep sell-offs gripping the market since October.

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